Indian hotel industry takes back Rs 1.30 lakh cr revenue hit in FY21, asks for government support: FHRAI
âThe total turnover of Indian hotel industry in fiscal year 2019-20 was Rs 1.82 lakh crore. According to our estimate, in fiscal year 2020-21, around 75 % of industry revenues have been wiped out. That’s over Rs 1.30 crore lakh touched, “FHRAI said in a statement.
Businesses are closing regularly and unproductive assets (NPAs) are increasing, he added.
Since March 2020, the industry has struggled to manage its statutory obligations and capital expenditures. Paying off loans with interest is not only difficult but impossible in a harsher economic environment due to the current surge, said FHRAI Vice President Gurbaxish Singh Kohli.
Without a moratorium on IMEs and interest payments, the industry will collapse completely, he added.
“We call on the government to propose a sector policy that can mitigate any negative financial impact, including debt obligations accumulated or to be accumulated towards banks, financial institutions or any other entity, taking into account the current circumstances and its repercussions on long term, âKohli says.
While the FHRAI understands the government must prioritize, ignoring the industry even now will push it to the point of no return, he added.
“Without wasting any more time, the government should make the necessary special arrangements to waive legal burdens for the hospitality industry,” Kohli said. The hospitality industry should be offered exemption from property tax, water charges, electricity charges and excise license fees for the lockdown period, he added.
FHRAI Jt Honorary Secretary Pradeep Shetty said working capital support with a low interest rate from the government will help hotel establishments struggling to restart and maintain operations due to overflows. negative cash flow. “We also call on the government to compensate employees engaged in the industry and their families for the loss of income,” he added.
âAlong with the extension of the three-year moratorium, the industry will need full loan interest relief from March 2020 until business is normalized,â said FHRAI vice president, Surendra Kumar Jaiswal. Being an employment-intensive sector, a concrete policy is needed to support the hospitality industry, he added.